New CMS innovation chief aims to move the national needle on quality, costs

Dr. Patrick Conway succeeded Dr. Richard Gilfillan as director of the CMS Center for Medicare and Medicaid Innovation in September. Conway, 39, a practicing pediatric hospitalist who completed his residency at Harvard Medical School's Children's Hospital, also continues to serve as the CMS chief medical officer and director of the CMS Center for Clinical Standards and Quality. The healthcare reform law established the Innovation Center to develop and implement cutting-edge healthcare delivery programs across the country that include accountable care organizations and bundled payments for episodes of care. Conway met with Modern Healthcare reporter Jessica Zigmond to talk about his agency's work and his goals for 2014. The following is an edited excerpt:

Modern Healthcare: What were some of your top goals when you started in this position?

Dr. Patrick Conway: As you know, we're focused on testing new models to improve quality and lower the cost of care, meaning better health, better care and lower costs. When I started, we looked at the current models, like Pioneer ACOs, that are already launched, and we're focused on executing those models well and evaluating them in rapid-cycle evaluation to determine which are improving quality and lowering costs. So that was goal No. 1.

We also analyzed the Innovation Center portfolio to see if there were any gaps or new models that might need to be developed to round out the portfolio, and we're now doing the work of developing new models focused on areas that may complement the existing portfolio. Lastly, we're doing work with the Innovation Center to embed innovation and delivery system reform across the CMS. So it's not just an Innovation Center activity. It's a broad delivery system transformation agenda across the CMS and working with external stakeholders.

As an example of what we do, we're testing primary-care interventions through our comprehensive primary-care initiative. If we've learned what may be effective in transforming primary care, how do we take components of that and put them into our core payment programs?

MH: What changes has the Innovation Center made in the second year of the Pioneer ACO program based on the lessons that you learned in year 1?

Conway: We are adjusting the models as we learn, so this is the theme of rapid-cycle evaluation. A few key points on the Pioneer model: Overall, it generated shared savings. From a cost perspective, it lowered costs. And then on the quality side, the Pioneers outperformed published benchmarks on 15 out of 15 clinical-quality measures and four out of four patient-experience measures. So, very positive quality results and shared savings were generated out of the program.

MH: How does that affect year 2?

Conway: We continue to work with the Pioneers on the risk tracks and the ability for them to interact with beneficiaries and coordinate care as best as possible. Pioneers are leading-edge organizations. They often come in with ideas about how they could better coordinate care and get the results we want in terms of better health, better care and lower costs. So we continue to adjust the program to try to make it as effective as possible. On the quality measures, the Pioneers asked us to look at basing the benchmarks for quality measures on data. We actually proposed to do that in a rule that we plan to finalize soon.

MH: How would this work without basing the benchmarks on data?

Conway: Initially because we didn't have data, we set absolute thresholds. So 30% performance was 30th percentile, 40% performance was 40th percentile. Now that we have data from ACOs and large groups through our physician quality reporting system, we want to take that data to set the benchmarks.

MH: What's the current status of the Bundled Payments for Care Improvement Initiative?

Conway: We've had a lot of interest in the model, so there was a Phase 1, where there was data sharing. There are four models. A number of organizations started Oct. 1. More plan to start Jan. 1, and then we have a construct where they can add episodes or subtract episodes over time, which got a lot of positive feedback from the marketplace. So there is robust interest. We don't have data back yet, but we'll be monitoring it closely.

MH: What intrigues you most about the bundled-payment initiative?

Conway: I think the really intriguing part of this is it essentially says, “We're going to bundle payment for an episode of care and we're going to let providers innovate within that bundle to try to deliver higher quality care at lower costs.” So it moves us away from a fee-for-service system where we're just paying for volume and it moves us to paying for a bundle of services.

I used to be on the hospital side running delivery-system transformation. I can tell you that in the private sector we had many bundled-payment type contracts and it really enabled us to say, “We know what our payments are going to be, now let's deliver that higher-quality care at lower cost.”

MH: What would you say your greatest challenge has been so far?

Conway: I think the biggest challenge is also the biggest opportunity. I came to the CMS and I took on this Innovation Center job because I think our health system can actually achieve much better results. I believe we can achieve better care and better health at lower costs. The challenge is that the Innovation Center is at the nexus of delivery-system transformation. So there is a lot of pressure and interest in more results faster. And a lot of this health system change takes time to redesign care for patients and achieve those better quality results at lower costs. I hope our nation has some patience that we're going to be testing models. They're not all going to be successful. That's the nature of innovation and testing. Many of them will be successful and will achieve the results we need. We're already showing that we're learning and putting those results into practice. So the challenge is, how does one effectively innovate in rapid cycle within a government construct?

MH: How would you describe your leadership style?

Conway: I try to have a collaborative leadership style. Specifically, getting to a shared vision and understanding. Then strategic objectives with the leadership team: Here's our specific goals and objectives. And lastly, I believe strongly in performance measurement and system redesign. So even within the Center for Clinical Standards and Quality that I ran previously—and now we're starting it at the Innovation Center—we're applying principles like Lean system redesign to our internal processes. We are trying to model what we want out of the health system internally.

MH: Can you give an example?

Conway: In our Quality Center, we brought contract modification time down 80% by redesigning the process. We brought in fellows in from outside of government and healthcare, from Intel and other organizations, who taught our staff the Toyota Lean production system. Now we're applying that internally to CMS processes. We do a lot of contracts at CMS, so we worked on how quickly we modify contracts. And we brought that down 80% from 2012 to 2013 at the Center for Clinical Standards and Quality. We're trying to apply similar continuous improvement principles at the Innovation Center.

MH: Will the Innovation Center staff also be trained in Lean?

Conway: Yes. There's some evidence that to change organizational dynamics, you want to train at least 5% of your organization in advanced improvement concepts.

MH: What are your concerns for the Innovation Center if the healthcare reform law's rollout is not running more smoothly soon?

Conway: We've got an excellent foundation of models that are already launched. We're now working on what are the models to complement and complete that portfolio. I, personally, and we, the Innovation Center, are extremely focused on results in terms of health system transformation. So I think we'll continue to drive for those results.

MH: What are the first places you will look for results in the new year and what are some goals for 2014?

Conway: For our Pioneer ACO program, it's the first formal evaluation year. We reported the actuarial results and the quality measures. For all of these, we also have a formal evaluation contractor that does a complete, multivariable regression model evaluation. We hope to report that early in 2014.

MH: That will tell us what?

Conway: It will basically be a robust evaluation based on all of the factors, including clinical co-morbidities, etc., to give us a formal evaluation of the cost and shared savings and the quality results for the first year. And then, for Partnership for Patients, we plan to have results that we'll report in 2014. For the Comprehensive Primary Care Initiative, a multipayer initiative, we plan to have results that we will be able to report in 2014. I think you will see more and more results come out of the Innovation Center.

MH: Is there something you're most excited about?

Conway: Medicare readmissions within 30 days of discharge were 19% to 20% for years. In 2012, it went down to about 18%. For 2013, it's going down even lower, heading toward 17.5% and lower. This means there are now over 130,000 Medicare beneficiaries who are staying home and healthy instead of getting readmitted. It's a great example where you can combine investments through quality improvement organizations and Partnership for Patients on quality improvement, and incentives in the payment programs for value, that you move a national number that people thought couldn't move.

And now you're seeing it move nationally. The Partnership for Patients has a broad goal of a 40% reduction across 10 areas of harm, of which bloodstream infections is one. Our 26 hospital engagement networks in that program all achieved their results of more than a 30% reduction in six or more areas of harm. Healthcare-acquired central line bloodstream infections are down 44%, and surgical site infections are down 22%.

MH: What's your personal reaction to those results?

Conway: When I was in pediatric residency in the early 2000s, I had a neonatal patient who had a central-line bloodstream infection and died. At that time, we didn't know how to prevent those events. Now we not only know how to prevent them, we're preventing them at a national scale, which is why I do this job. It's the most exciting part, by far.

MH: Any final thoughts?

Conway: I think there's increasing evidence that we're moving the national needle on better quality and a more financially sustainable health system that spends dollars more wisely.

Follow Jessica Zigmond on Twitter: @MHjzigmond